Bias: EUR/CHF remains bullish-to-range-bound, trading above its 90-day average and in the upper half of the 3-month range.
Key drivers:
- Rate gap: ECB policy sits higher than SNB’s stance, widening the interest-rate gap in favor of the euro.
- Risk/commodities: Oil trades above its 3-month average with volatility, a sign of risk appetite that tends to lift the euro versus the franc.
- One macro factor: Eurozone inflation is easing, supporting the ECB’s neutral stance and a steady euro.
Range: The pair is likely to drift within the 3-month range, with a test of the upper end possible.
What could change it:
- Upside risk: stronger Eurozone data or clearer signals from the ECB toward tighter policy that supports the euro.
- Downside risk: SNB hints at reintroducing negative rates to curb franc strength.